There once was a lovely Ship owned by a man who loved the Sea. She’d been built by the most expert of boat builders using all the latest technology for one very specific reason: to carry passengers from City A to City B in an enjoyable, timely, and safe way. To make sure the Ship achieved this goal, the owner hired the very best of Captains. The Captain had a great sense for the Sea, acquired over nearly a lifetime of sailing. He understood the Sea better than anyone – the currents, the waves, the tides, the constellations, and all things related to the running of a Ship.

Now of course the Captain could not do everything on such a large and modern Ship by himself. So, he hired the very best Director, Chief, and Deputy. The Director managed all the services relating to the happiness of the passengers, the Chief managed all the electrical and mechanical components of the ship, and the Deputy was in charge of sailing and navigation. You see, in order to take happy passengers safely from City A to B, many things had to happen in perfect concert, and the happy Crew dedicated themselves to this end.

This went on for many years, and all the Crew were able to perfectly hone the method by which they carried passengers from City A to City B in the most enjoyable, timely, and safe way, making the Ship one of the best in the entire world. And the passengers were so happy that they often returned to travel again and again. The crew was happy because they enjoyed their work, and the owner was happy because his business was successful and making money every year.

One day the owner decided that the time had come for him to retire and sell the Ship. He found a most willing buyer who saw the great success of the Ship and thought it would make an ideal investment. The new buyer was also new to Ships, but he seemed eager to learn and he was very impressed by the majesty and the success of this particular Ship. Though he had never travelled on it, he had spoken to his Advisors, and they thought that he might be able to sell the entire business only a year later at double the price! Such a return was practically unheard of, and so he was very excited about the prospects for this Ship. He promised the owner that he would continue to run the Ship responsibly.

Life on the Ship continued just as it had before – the Ship carried happy passengers in the perfect method honed by the Crew, and everyone was happy. One day, as he was crunching the numbers, the new owner realized that he could possibly sell the Ship next year for triple the price he had paid! Just a small amount of cost reduction here and there and he could make it happen! So he spoke to the Captain, the Director, the Chief, and the Deputy about ways to cut costs – “just small things mind you… we still want to ensure that we’re carrying passengers from City A to City B in the most enjoyable, timely, and safe way. This is our number one goal as always! But, if you can cut the costs for your department by 25%, you will earn a large bonus!”.

The Director, Chief, and Deputy went their separate ways and dedicated themselves to reducing their respective costs by 25%. The Director was very close to retirement and thought a bonus would be quite nice. She began to crunch the numbers and soon realized that she could save money in some very simple and straightforward ways. First, they would close one of the restaurants and its kitchens and instead have multiple dining sessions in the main restaurant. This way, they could serve meals with half the staff and provide fewer food options. Also, should any of the crew choose to leave over the next few months, she decided that they would be replaced with junior crew members at a great discount, and these things combined would achieve the goal of saving 25% in Hospitality. When the new owner heard her plan, he very happy. In fact, he thought the Director’s change to hiring practice was so inspired, that he thought it should apply to every group on the ship. And he made it so.

The Chief was having a bit more difficulty. He investigated keeping fewer parts in inventory. He contemplated keeping fewer engineers on staff. He could come up with no better alternative, so by this method, he was eventually able to create a plan to cut costs by a whopping 30%. But there was a tight, nagging feeling in his stomach that he was forgetting something that was quite important. When he presented his plan, the owner was quite thrilled, and sang his praises throughout the Ship as someone who was really willing to go the extra mile. The Chief had never before been so lauded by the owner of a Ship, and so he began to feel quite proud of his accomplishment.

Now, truth be told, the Deputy was more than a little miffed at all the attention that the Chief was getting. Surely there was no job more important than actually sailing the Ship! Yet the praise for the Chief continued, and the Deputy decided that the only way he would outdo him would be to cut costs more. So the Deputy called a Sailor to the Bridge and set him on the helm while he went off to crunch the numbers. He realized that if they changed the route and fired the engines at a much lower rate, they could cut their fuel use by nearly half! With fuel prices on the rise, this was a very good idea indeed. Since fuel was the main expense in navigation, he was able to cut costs by an astounding 40%. He presented his idea to the new owner, who was absolutely ecstatic and wondered why on Earth this had never been done before! “It will take us an extra day to reach City B…” the new owner mused. And then a tiny, yet thrilling, inkling took form in the new owner’s head… “But, we can charge the passengers for this extra day!”. And so it was done.

At this point, the new owner was so impressed by the efforts of the Director, the Chief, and the Deputy, that he decided that he ought to lead by example and take drastic measures himself. He called the Captain in and began to ask him some curious questions. “Is it true that you have hired the very best Director, Chief, and Deputy.” And of course the Captain, with full confidence in his Crew, said yes. The new owner continued “Is it also true that the Director manages all the services relating to the happiness of the passengers, the Chief manages all the electrical and mechanical components of the ship, and the Deputy is in charge of sailing and navigation.” Again, the Captain answered yes. The new owner then expressed an odd look of confusion before continuing. “Then, what precisely do YOU do?” And the Captain answered “I ensure that the entire Ship is functioning in perfect concert to move passengers from City A to City B in an enjoyable, timely, and safe way”. The new owner mulled this over carefully. And though that did seem like a noble cause, the owner decided that the Ship was functioning very well and that the Director, Chief, and Deputy would be perfectly capable of handling this going forward – didn’t they do this work anyway? And then the new owner had very best of Captains escorted from the Ship.

The new owner had heard that the key to successful changes on Ships was clear communication. So, later that very day, the owner sent a very clear communication to the Crew relating the departure of the Captain and the itinerary change from four days to five. Despite the clarity of the message, the Crew seemed oddly unhappy. In fact, some even seemed prone to sudden bouts of weeping, which the new owner found very curious. The Director complained that she suddenly had to plan meals and order an extra day’s worth of food on very short notice. The new owner answered that it shouldn’t be a problem because the passengers were paying for that extra day. And so, the diligent Director rose to the occasion, quickly working out a new meal plan and ordering the extra food to be loaded in City A on the following day. The crisis was averted, and the Director breathed a great sigh of relief. The Chief didn’t appear to be impacted by the itinerary change, and of course, it had been the Deputy’s choice in the first place, and so all was well.

Their bad luck began early the next day as they approached the harbour in City A. The winds had shifted in a strange direction and the current was stronger than normal. Since the Captain was usually at the helm while docking, this proved a challenge for the Deputy, but, with the new owner’s full confidence behind him, he felt quite up to the task. As the Ship swung into the dock, there was just one slight bump, barely perceptible, but felt by all, nonetheless. After examining the Ship, the Chief assured the Deputy that all was well. The bump had done no damage at all, except to dislodge one, small electrical panel, which was used for a minor, auxiliary system and, regardless, it should be fixed quite soon. Of course, with the crisis averted, the Deputy was relieved, and they went about the busy work of preparing the Ship for the happy passengers.

Under the watchful eyes of the Director, the extra food was loaded in the cargo bays of the Ship without a hitch, and everything seemed to progress on schedule. As usual, the Chief cleared the Ship to sail, and they left port uneventfully to sail for City B, with their happy passengers in tow. Now it takes a good amount of time to unload supplies for a five-day journey, so this continued on well after they had left the dock. When the Crew began stocking the kitchens and restaurant, they realized they had one small problem… nothing major of course, but someone should probably let the Director know. The refrigerators and freezers were full to the brim, and there was still half a day’s worth of food to put away. A casual observer might note that shutting down the other restaurant and its kitchens had caused this very small problem, almost not even worth mentioning, but there was an additional, unlucky glitch. The little electrical panel, dislodged by the mostly imperceptible bump on the dock, had been powering the large auxiliary freezer already full of food. Something had to be done.

The Director decided to call an emergency meeting. She could not recall ever having an emergency meeting before, but it seemed like the reasonable thing to do. So, the Deputy left control of the Bridge with a Sailor and the Chief was summoned from engineering and together, they met to discuss the small problem.

“Not a problem at all”, said the Chief – the electrical panel will be fixed in just a few short hours. Quite an easy fix, he added. Just about anyone in engineering could do it. The Director, in the meantime, decided to move some less-perishable items from the fridges, and thaw some dinner items early in order to make way for the extra food. So, relieved, and with the crisis averted, they set off to do their work.

Later that day, their luck only got worse. Noone in engineering could find the parts they needed to fix the electrical box. As luck would have it, they needed two parts, and only one was available – the second of the pair had not been replaced some months back, in order to reduce inventory.

So the Chief thought it wise to call another Emergency meeting, since it had worked so well before. And the Deputy left control of the Bridge with a Sailor and the Director was summoned from Hospitality. After explaining the situation, it became clear that there was but one possible course of action – they must turn back to City A and cancel the trip. The Deputy concurred that this must be so and agreed to change course immediately for City A, while coordinating their return with the Port Authority. So, with the crisis averted, they set off to do their work.

Back on the Bridge, the Deputy turned the Ship back towards City A, but he just couldn’t seem to catch a break. When he contacted the Port Authority in City A, they had no room for the Ship in the Port. That was when the usually-calm Deputy began to feel the stirrings of what could only be described as panic. So he called another Emergency meeting and passed off the helm to a Sailor.

The Director, the Chief, and the Deputy met once again to find their way out of the horrible and unlikely circumstance that they’d found themselves in. Luckily, the Chief had quite a brilliant stroke of inspiration. “I’ve got it – we will just fire up the engines on full, change our course and make it to City B in four days instead of five. We’ll throw the extra food overboard so that it doesn’t rot, and we’ll simply skim a little off the other meals to make up for the broken freezer. That made complete sense to the lot of them and, with the crisis averted, they set off to do their work.

The Director coordinated the jettisoning of the extra food, while the Chief made his way down to the engine room in preparation to fire up the engines. The Deputy returned to the Bridge and relayed the plan to the Sailor at the helm. The Sailor immediately grew pale, which the Deputy found to be an exceedingly strange response. “Whatever is the matter?”, he asked, certain that nothing could compare to the terrible luck they’d already had in the short span of a day. The Sailor simply choked out one word. “Fuel.” A chilling realization began to flood the Deputy and he barked “Get down to the engine room now and stop the Chief from starting the engines – we need to conserve the fuel”. He realized that they were already wasting their precious fuel travelling back towards City A!

The Deputy knew now that the most important of Emergency meetings was immediately required, and he looked around for someone to take the helm. Having sent the Sailor to Engineering, the Bridge was empty, save for a young Sailor who was staring at the horizon through a large pair of binoculars. The Deputy called out “You! Man the helm. I’ll be right back”. The Sailor’s eyes widened in fear and he replied “But Sir, I’ve not taken the helm. This is my first sailing. I’m a Junior Sailor. My job is to look through these binoculars out at the horizon”. Frustrated, the Deputy called for another Sailor, and, when none appeared, bemoaned his terrible fortune – he was now surely between the Devil and the deep blue Sea. Then he recalled how productive their Emergency Meetings were – they made their plans so efficiently and quickly that surely he could leave for just a moment. That’s it – he would be back in a jiffy. So he patted the Junior Sailor on the shoulder and told him to keep watching the horizon through his binoculars and said that he would return in the very briefest of moments.

On his way to the Meeting, the Deputy realized the most prudent of actions would be to stop in the kitchens to order an immediate halt to the jettisoning of food, but they had been so efficient in their work that he found the job nearly complete. When he reached the meeting, the Deputy explained that they did not have enough fuel to fire up the engines on full power to cut off the extra day of sailing because of the planned reduction of fuel costs. This seemed to stump them all – what absolute rotten luck! Not a single person could find an solution to their latest predicament, so they just sat in silence for a few moments, the Deputy with his head in his hands. Finally, the Chief spoke up, glaring at the Director.

“None of this would have happened if you hadn’t closed the second restaurant!”. The Director stared back in shock. “What does a fuel problem have to do with a restaurant? If this is anybody’s fault, it’s the Deputy’s for not carrying extra fuel!”. The Deputy was having none of this, so he shot back “We wouldn’t need any extra fuel if we had just one, small, spare part – as far as I’m concerned – this is the Chief’s fault.” And the Chief countered that they needed the extra part only because the Deputy had struck the dock. And so this continued for quite some time.

Back on the Bridge, the Junior Sailor was busy marveling at a very curious phenomenon. He had begun to realize that when a ship is moving steadily across great expanses of calm, open water, with no obstacles and no clear and imminent destination in sight, it can continue in such a manner for a surprising amount of time without a soul realizing that noone is steering the Ship at all. Through his binoculars, he could see a great flurry of activity all around the ship, of course. “This surely is a Ship where all manner of important things get done!” the Junior Sailor
thought. He felt very proud and fortunate to be part of such a Ship. And truly, many important things were getting done, though it also remained true that, while those important things were getting done, the Ship sailed on, completely unmanned.

The Junior Sailor understood his job quite well – his sole purpose was to watch the horizon for signs of any danger or obstacle and relay them to the helmsman. He remembered from his training that the key to identifying dangers through large binoculars was to look for breaking waves that seem out of the ordinary, so he diligently scanned the horizon of the calm Sea for any such activity and saw none. He was not terribly concerned that nobody was at the helm, because the Sea was so calm, and the Ship seemed to move forward in a straight line anyway, and the Deputy knew what he was doing and had promised to be back soon, besides.

As the sun rose in the sky and the light scattered across the water, the ocean grew calmer still. The Junior Sailor began to wonder when someone might return to take the helm. He could not leave his post, of course, since it had been impressed upon him that his job was to look out at the horizon and that it was absolutely essential to do so. He was not terribly concerned, because, this being such a beautiful day on the Bridge with calm seas and clear skies, surely he would see any hazard from miles away.

The first sign of something gone terribly wrong was not even a wave at all… it was just a ripple – the tiniest of ripples spreading out across the glassy Sea not a hundred metres from the Ship. The Junior Sailor realized in horror that they were approaching a rock shoal. As protocol dictated, he immediately turned towards the helmsman – only of course there was no one there. There had been no protocol at all for this scenario that he found himself in so unluckily, so he did what he was trained to do and continued to stare at the shoal through his large binoculars.

The Ship struck the shoal mere moments later, causing Crew and passengers to be knocked off their feet and breaching the hull of the Lovely Ship in a way that can only be described as catastrophic The Crew knew exactly what to do in this situation – they immediately mobilized to implement their evacuation plan, and all Crew and Passengers were safely and quickly evacuated to the life rafts, and SOS was relayed as the lovely Ship, built by the most expert of boat builders, and run by the very best Director, Chief, and Deputy, took on water and inevitably sank to the bottom of the Sea.
And so it was, for the first time in many years, the Ship did not carry passengers from City A to City B in a most enjoyable, timely, and safe way. In fact, it was quite the opposite – never had a group of passengers arrived in any place in such an untimely manner and so utterly miserably.

The evacuation efforts of the Ship were deemed a great success and praised worldwide as a marvel of modern nautical planning, engineering, and crisis management. In fact, the Deputy, the Director, and the Chief, among many other Crew members, received awards of high honour for the safe evacuation of all passengers and crew with not a single life lost. The Director retired happily, the Chief was hired on to an even bigger and more complex Ship, and the Deputy achieved his lifelong dream of becoming a Captain. The new owner, while disappointed, was paid out by the Insurance company, and went on to invest in other businesses including pharmaceuticals and supply chain management.

After a short inquiry, the blame was laid squarely on the Junior Sailor, who was never to sail on any Ship ever again.

I’ve finished the 12 Days to Deming course by Henry Neave, and I still do not purport to understand Deming’s System of Profound Knowledge. However, I do believe that I have a better foundation to continue learning. Like many, there are very few things I’ve stuck with over the long haul in life, and I’ve done my fair share of “job hopping” over the years. I think the most daunting aspect of deep study into Deming is the idea of putting in the time and effort to gain a deep understanding, seeing the potential that companies and societies have, and then witnessing it go unfulfilled. I’ve seen lesser disappointments break people in the workplace. Those people who are able to continually do this type of work are remarkable, usually possessing a rare combination of optimism, resilience, and a deep connection to the work that they do.

In our study group, I had the privilege of meeting just such people as I described above – relentless in their optimism and belief in the power of Deming’s work to change organizations and ultimately the world we live in. If you are beginning to study Dr. Deming’s work, I highly suggest finding a group of open-minded individuals to study with, whether it’s a book club or through a course like Dr. Neave’s. If you can find these people, you’ll be much better off. I once asked Dr. Bill Bellows how to avoid being completely overwhelmed and depressed when you begin to see the dysfunctional systems around us, and he replied with something along the lines of “Find a group of people… chances are, when you’re depressed, they won’t be. And vice versa.”

Yet, despite our optimistic group, I still feel one nagging question constantly brewing: is a Deming organization really possible? Aren’t Deming’s principles diametrically opposed to the values of our current society?

Where the world is fast, Deming is slow.
Where the world is superficial, Deming is deeply profound.
Where the world is reactive, Deming is proactive.
Where the world obfuscates, Deming clarifies.
And
Where the world seeks to reinforce beliefs, Deming seeks truth.

How can this possibly change? In The New Economics, Dr. Deming wrote:

The first step is transformation of the individual. This transformation is discontinuous. It comes from understanding of the system of profound knowledge.The individual, transformed, will perceive new meaning to his life, to events, to numbers, to interactions between people. Once the individual understands the system of profound knowledge, he will apply its principles in every kind of relationship with other people. He will have a basis for judgment of his own decisions and for transformation of the organizations that he belongs to.

This is my hope. I hope that individuals all around the world are right now finding the works of Dr. Deming and gradually and discontinuously transforming. We do not need a majority; only a critical mass. If each of us begins to apply the principles of profound knowledge, organizational change will be a natural byproduct. I believe that Deming organizations are not only possible – they are inevitable.

When adopting the New Philosophy and moving toward becoming a Deming Organization, one of the most difficult things we’ll have to do is identify and question our sacred dogmas. I’m not talking about a sacred dogma in the context of religion (although they share similar characteristics), I mean the sacred dogmas that are so embedded in our organizations that they’d be impossible to exorcize. Confronting sacred dogmas can be the number one barrier to change for companies (and indeed for individuals as well). Many companies will not get past this step because it can be uncomfortable or even painful, shake the foundation of your organization, and shatter people’s carefully constructed belief systems and identities.

I’ve seen a few videos of Dr. Deming’s 4-day sessions, and when people ask questions related to transforming their organizations, there’s one sacred dogma in particular that rears its ugly head over and over again. It’s really kind of funny… every time I hear this, I think “not THAT again”, because in the grand scheme of things, it seems somewhat trivial. What is this sacred dogma? Sales people must work on commission.

Now, I know one or two sales people, including my husband. When I’m brave enough to bring up this contentious topic, he looks at me like I’ve just suggested a deep betrayal. Of course sales people work on commission – try salaries and they’d all quit. No self-respecting sales person would EVER choose to work on a salary. It would take away their drive, their fire, their productivity, and their CASH. Businesses would flail, shareholders would suffer. It’s all fire and brimstone, doom and gloom. And so the commissions continue.

This is an example of a sacred dogma. Whereas people seem to be able to wrap their heads around the possibility of eliminating quotas, rankings, promotional incentives, contests and other common motivational techniques in sales organizations, commissions remain sacrosanct. When something is so accepted that any alternative is unthinkable, you’ve got yourself a sacred dogma.

After just over a year of studying with Dr. Deming and Dr. Baker, and eliminating many of the other supposed “sales motivators”, Jim McIngvale (Mattress Mack), CEO of Gallery Furniture, was still hemming and hawing over one thing – commissions. Gallery was about as sales-y an organization as it gets – more than half of their employees were salespeople and they did “whatever it takes” to close a deal. When he mentioned it to Deming and Baker, their response was “just do it!”. And that’s how Gallery Furniture eliminated commissions and moved their salespeople onto salaries.

I’m not going to go into exactly what happened at Gallery Furniture, because there’s plenty of information online on this particular case study. Suffice it to say, there was no fire and brimstone. The organization did not descend into chaos. There was no reckoning. Some salespeople did decide to part ways with the company; however, most did not. In the end, eliminating commissions actually exorcised some pretty toxic (albeit rational) behavior, and the organization benefited all around. They recognized they had a sacred dogma, questioned it, and in the end, took the leap to try something different.

Sales commissions are just one example of many sacred dogmas that are pervasive in business today. Others include:

• Engineers and/or developers don’t work well in groups
• Developers can’t test
• We’re successful because of the way we’ve always done things
• People are inherently lazy

If it’s uncomfortable (or even impossible) for you to challenge any of the above statements (or anything or imperative in your workplace), your organization may be sacrificing itself at the altar of a sacred dogma. The more uncomfortable it is, the more important it is to openly question it by asking:

• Can we absolutely know that it’s true?
• If so, how do we know that it’s true?
• What might be some of the effects of this dogma on the organization?
• What would our organization look like if we did the opposite?
• How could the dogma be creating a self-fulfilling prophecy?

Next up, I’ll be taking a deeper dive into the exorcism of the sales commission dogma.

Completing Day 6 of the 12 Days of Deming course and it’s difficult to not feel simultaneously optimistic and deflated. Deming’s 14 Points are investigated in Days 4 and 5, and while noble goals, these 14 points left me overwhelmed. “So THAT’S all you have to do in order to achieve the full potential of an organization. Those 14 things. Oh and by the way, the opposites of those 14 points are deeply ingrained in current management philosophy.” Off to the moon we go! I think I may have taken the study group a little aback when I made this comment in our, otherwise calm and collected, session. A lot has been said about incremental changes, and they certainly have their place, but the truth is, Deming’s System of Profound Knowledge and his vision of the New Economy are not easy. They’re not necessarily an incremental change program – they require leaps. Leaps in philosophy, honesty, trust, faith, and curiosity that don’t typically inhabit modern corporations. To learn more about the 14 points, see https://deming.org/explore/fourteen-points/ .

Now how often will someone take a leap if they have no real incentive to do so? I’m not likely to leap across a chasm unless I’m damn-well certain that there is something on the other side that I don’t currently have and that I desperately need. Japan is a good example of this after WWII – the morale of the people was so low that it was almost imperceptible, their economy was at rock bottom, and the US was kicking their butts in manufacturing. They had almost nothing to lose and almost everything to gain – that’s when taking a leap is easiest.

These days, our companies are likely doing “OK”. We’re not at rock bottom, things aren’t desperate. It’s very tempting to believe that keeping on the same way will forever produce the same “OK” results. Many companies have tried this strategy and disappeared seemingly overnight. However, their demise did not occur overnight, and chances are the leadership had plenty of warning signs and chose not to heed them in favour of hoping that the past results achieved by maintaining the status quo would prevail. Right now we need leaders and organizations to take their leaps before they’re desperate. In the current, forgiving economy, especially in software, it may not be obvious that your company has entered a death spiral. But the signs are there if you look for them. Take the leap before the gap widens to a canyon.

I will start this off by saying that if you aren’t familiar with Dr. Deming’s Red Bead Experiment, please watch the abbreviated version here: https://www.youtube.com/watch?v=ckBfbvOXDvU

I’ve been a participant in the Red Bead Experiment quite a few times over the last five years or so. I’ve been a Willing Worker, an Observer, I’ve done Quality Control and recorded results, and, more recently, I’ve been the dread Foreman. I’ve experienced it with coworkers, at meetups, and with company leadership. As most who have experienced this experiment, I’ve had many observations and insights emerge, sometimes long after the experiment is over.

The first time I was involved in the experiment, it seemed pretty obvious that “management by results” meant reacting to the inevitable Red Beads. I was a Willing Worker. I was excited and it seemed easy enough – I could do this job. The experiment beat me down within minutes – excitement quickly faded to that feeling in your gut of having let someone (or yourself) down. Logically, I knew that the difference between success and failure was a function of probability and luck, but inside, the scolded child in me rose up. It wasn’t just me either – the culture of the White Beads Company degraded, even to the point of snitching on coworkers for “not following the rules”, irrational pride over low Red Bead counts, the “best” Willing Worker’s impromptu “coaching” of other workers, and an emerging class system of “bad” workers vs “good” workers. Our once-jovial and pleasant Willing Workers quickly descended into a competitive, backstabbing, miserable bunch.

On future experiments, the subtle consequences of incentives began to emerge. As the Foreman, I once forgot to mention that all holes in the paddle must be filled. On Day 3, a clever Engineering Manager filled only 3 holes in the paddle with White Beads, effectively getting no Red Beads at all. This one was insidious. I fired that worker immediately (to his amusement), but thought about what he did long afterward. Under threat of punishment for a measure he had no agency over, he chose to control one of the only things he could – his exposure to failure. Instead of risking failure, he simply chose to produce less. Afterwards, I began to notice that this happens in real companies more often than we can imagine and is a major contributor to the waste of lost potential in our organizations.

After another experiment, I listened to a very experienced Foreman explain how he decided to fix the system by removing the Red Beads as they were picked up in the paddle. He continued to plot the control chart accordingly until all red beads were gone. At the time, I thought this was way cool (though presumably time consuming) and it took me until much later to realize what this really equated to. The Red Beads were coming from the Supplier, so, in the next shipment, you’d be back at square one and you’d have to remove them all over again. The system wasn’t “fixed” at all. Removing the beads in this manner, without thinking about how they got there in the first place, amounted to transactional busywork.

For years, I was certain that the point of the Red Bead Experiment was to help people understand that they have to fix the issues in their system first (ie get rid of the Red Beads). However, after further thought, I’ve come to some different conclusions. Namely, that:

The Red Beads were never the problem at all.

The Red Beads didn’t represent issues that had to be fixed – instead, they represented a tradeoff that had been made. The actual problem may be management’s unwillingness to accept the consequences of making that tradeoff.

The leadership at the White Beads company decided that it was worth it to buy a supply riddled with Red Beads, likely because the pricing was attractive. There may be very valid business reasons to make a tradeoff like this – sometimes a company just doesn’t have the capital. This kind of tradeoff may even be key to the business model itself – buy absolute junk at a really low price and then turn it into something amazing. The difference in the Red Beads experiment is that leadership was completely ignoring the tradeoff that they had chosen. And worse yet, they were managing like that tradeoff hadn’t been made at all and blaming the Willing Workers for it.

Remember our Foreman who removed the Red Beads from the paddle and discarded them instead of returning them to the container? That could be a valid approach to this tradeoff. However, we have now created in industry to remove Red Beads. Tradeoffs that result in friction to the business also have the tendency to create internal industries to prevent that friction from turning into a fire. There’s already evidence of this at the White Bead Company – Quality Control is focused on counting Red Beads. They’re not making sure that the White Beads are good quality, low in variation, or that they’re what the customer actually needed in the first place. If they chose to remove the beads, that activity would be part of this industry as well.

Industries will always pop up to manage the consequences of the tradeoffs you’re making – industries can be roles or duties. They can be the “fixers”, the Ray Donovans among us, who go around dealing with the fallout. The trouble with industries is that they tend to be myopic, highly focused in their devotion to covering up the consequences of the tradeoff. These industries also tend to grow and solidify. And because they rely on the existence of the tradeoffs in order to exist themselves, they can wind up being dedicated to maintaining those tradeoffs.

Tradeoffs are part of our everyday life and work. Back in February, I witnessed the consequences of a tradeoff at my own workplace. Nearly 6 months earlier, a decision had been made to trade off longer-term risk for the short-term cost and time savings in development. The only problem? That decision was filed under a heap of other tradeoffs that were promptly forgotten by everyone. In the end, our entire system went down for thousands of users. And even worse, a separate (but related) tradeoff caused the issue to be very difficult and inconvenient to fix. When tradeoffs are made unconsciously, their consequences will eventually surface and wreak havoc – the time will come when they make themselves visible, even when the most industrious and clever group is dedicated to holding them at bay.

As I continue with the Deming Study Group, some of my goals are to find ways to make tradeoffs visible to the organization as a whole and to uncover the friction that has been quietly but consistently invading our organizations. And perhaps most importantly, to help leadership make conscious decisions about the tradeoffs they’re choosing and to accept what those decisions mean for all of our Willing Workers.

I’ve recently discovered a fascination with Formula 1 racing. This probably has a lot to do with the Netflix documentary series and the way I binged the entire season in under a week. I was so stoked that, in a bid to watch even more Formula 1-related content, I rented a documentary from my local library called 1, which explores the history of safety in the sport. Suffice it to say, Formula 1 has had a dangerous, tragic history, with more than fifty drivers, and even some bystanders, perishing in the last 67 years.

One of the major barriers to change was that everyone accepted fatalities as an inevitable byproduct of racing, so changes were slow. Jackie Stewart, three-time World Champion, observed that given the choice between two cars, a safe car or a car that’s 2 seconds per lap faster, the drivers will always choose the faster car. He argued that because of this fact, it has to be the management that sets the standards for safety – it absolutely cannot be the drivers.

Just as in Formula 1, most companies today are choosing speed above all else. In today’s fast-paced, delivery-centric workplaces, I continually see drivers choosing faster cars over safety. In the software industry, this can be:

• taking shortcuts (technical debt) to go faster and meet deadlines (choosing unsafe code)
• skipping unit testing, refactoring, and other best practices (choosing unsafe code)
• avoiding difficult conversations because we don’t have time to deal with them (choosing an unsafe psychological environment)
• not addressing known problems with the system (choosing unsafe processes)
• accepting high attrition in their companies as the nature of the industry

It’s up to management to create a safe environment by requiring activities that promote safety. Management must stop accepting shortcuts as a byproduct of the industry. They must set rigorous standards and mentor and train the people in their companies on how to adhere to these practices.

There were a few major turning points in Formula 1 related to safety – in 1976 when Niki Lauda famously pulled out of the race, losing his world title, at the Japanese Grand Prix in extremely treacherous fog (to this day, he’s called selfish by the management at Ferrari), and when two drivers, Roland Ratzenburger and the three-time world champion Ayrton Senna both crashed fatally in separate incidents at the 1994 San Marino Grand Prix, watched by horrified millions on live TV. But the reality is that it was the little changes in attitudes over decades that have created conditions in which driver fatalities are now very rare for such an extreme sport – the belief that safety and speed could coexist.

Unfortunately, like Formula 1, choosing safety may lead to some slowdowns –  in the short term. Making safety a priority in your organization will inevitably lead to speed in the long term, with a lot less carnage in the meantime. And like Formula 1, it’s the role of management/executives/owners to set those standards of safety and to exemplify them, because, confronted with deadlines, the people doing the work will always choose speed.